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The Economic Crisis The American Revolution left the U.S. deeply in debt ($52 million, $ 626,392,587 today) Debt in the form of bonds

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Bonds are certificates issued to the government for an amount of money that the government promises to pay back with interest Both government and foreigners invested in bonds to help the war effort Speculators (people who invest in risky business ventures in hopes of making a large profit) bought bonds for less than they were worth

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Paying the Debt Summary Arguments Against U.S would pay the states Revolutionary War debt. South had already paid Move the capital to NYC to Washington

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A National Bank Summary Arguments Against National bank deposit governments money TJ thought it was unconstitutional Bank was established

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A High Tariff Summary Arguments Against Tax on imported goods Raise money for government and protect manufacturers Southerners opposed because it would help the north *Did not pass!

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Precedents Set What were some of the precedents set for the new government? Do you think they are on the right track?

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Loose vs. Strict Interpretation The belief that the central government can make laws or pass acts to add to its powers The Elastic Clause The belief that the central government only has the powers specifically given to it in the U.S. Constitution The 10 th Amendment

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The Whiskey Rebellion Imagine This: Alexander Hamilton has proposed a new tax on the production of whiskey. Congress has passed the tax. This is the first direct tax the new federal government has placed on its citizens. A group of farmers in western Pennsylvania feel this tax violates their rights, have refused to pay it, and have begun tarring and feathering local tax collectors.

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The Whiskey Rebellion What was Washingtons justification for using force? Was Washington really justified in sending the militia to deal with the problem of the whiskey rebels? Was Hamilton justified in asking the Whiskey Tax to be passed? Did the Whiskey rebels have a legitimate justice claim?